[PART ONE] MONDELEZ AND OLAM PROMISED TO OUTSMART COCOA FARMERS AND THEIR GOVERNMENTS?

Did They Over-Deliver?

Paraphrasing a section of the abstract from Dr Michael Odije’s research paper titled “Sustainability winners and losers in business-biased cocoa sustainability programmes in West Africa” to set the tone of this article.

In 2014, ten of the world’s largest chocolate multinationals combined, with more than $500 million in funding, to introduce a cocoa sustainability scheme called CocoaAction. In principle, CocoaAction and similar sustainability schemes sponsored by western multinational chocolate companies are interventions to empower cocoa planters and planting communities in West African countries. But in practice, as this article will show, these schemes respond to diminishing returns in cocoa-producing communities, the prospect of diversification, and the resulting projection of a shortage in raw material. There are signs that diversification away from Cocoa will benefit cocoa planters and their communities. Therefore, cocoa sustainability schemes are designed to help multinational chocolate companies at the expense of diversification in West African countries.

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In April 2021, we heard the news that Mondelez and Olam have teamed up to establish a 2,000 hectare of “sustainable” Cocoa farm plantations in Indonesia. To many people in the cocoa sector, the mere adjective “Sustainable” pre-fixed to this development makes it lose any scrutiny about the actual intended and unintended consequences of this project. To not foretell what the intentions of Mondelez and Olam are with their sudden vertical integration into establishing cocoa plantations, this article will highlight the counter productiveness of this movement toward the “Sustainability” objective they intend to achieve. I will also highlight my opinion on the reason for this move by Mondelez and Olam. I will further add the consequence of this development on the cocoa-producing economies and the livelihoods of smallholder cocoa farmers. Finally, round-up by advising Ghana Cocoa Board and Ivory Coast on how this OLAM/Mondelez initiative plus China’s entry Nigeria’s renewed energy to produce more Cocoa, all steps to render the LID inactive. Whereas I may not have answers to everything, I will make a few suggestions which I hope could provide smallholder farmers with some reason for optimism.

Olam and Mondelez’s Investment in cocoa plantations in Indonesia

Mondelez, in their Press release, highlighted their excitement to be partnering in establishing the world’s single largest “sustainable” commercial cocoa farm in Indonesia. This 2000-hectare “cocoa farm, according to Mondelez, is to “test a scalable approach for the future of “Commercial” cocoa farming”. They added that this Nucleus farm would be used to test the ability of their advanced climate-smart (including irrigation systems) and plant science technologies to optimally use the land for the maximum output in cocoa production. Mondelez informed of their future ambition to replicate this model across the region and highlighted how “demand” for Cocoa is growing in Asia and has the potential for increased demand for cocoa production. They further added that this project has been developed out of their years of experience with “the company’s signature sustainable sourcing program, Cocoa Life, and OFI’s ambition for sustainable cocoa, Cocoa Compass, to test a scalable approach for the future of commercial cocoa farming.”